Company name

Telefónica Celular del Paraguay S.A.

Project number

11611-01

Category B projects have potential environmental and/or social impacts and risks that are less adverse than those of a Category A and which are generally limited to the project site, largely reversible and can be mitigated via measures that are readily available and feasible to implement in the context of the operation.

E&S category
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B

Country

Paraguay

Sector

Telecommunications, Media and Technology

Status

Completed

Disclosed date

11/06/2016

Projected date at which a project will be put forward for the Board of Executive Directors’ approval.

Projected board date
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08/30/2016

Approval date

12/06/2016

Signed date

07/04/2017

Sponsoring entity

N/A

Team leader

Lopez Coronado, Gustavo

Investment type

Financing requested

N/A

Syndicated amount

N/A

Financing amount

USD $ 68,894,600

Currency

PYG

Project scope and objective

Tigo Paraguay’s has developed a coherent 5 years business plan that includes investing US$ 617 million from 2016 until 2020 mainly to support its offer of mobile access to broadband, fixed business lines and licenses and/or acquisitions. Out of the US$ 165 million (“Project Cost”) FY 2016 capex investment set in the 2016-2020 business plan, the IIC will support TIGO with up US$ 70,000,000 equiv. in local currency guaranies. The financing will have a tenure of up to 5 years including 2 years grace period of which Instituto de Prevision Social (IPS) will act as the Lender of record and IIC-IDB as Guarantor of IPS’s credit exposure. As Guarantor, the IDB Group (AAA) will cover 100% of IPS exposure to TIGO.

The use of funds of the project is to support (i) expansion of 3G network including the creation of fast mobile data network 4G-LTE in Asuncion, Ciudad del Este, San Lorenzo and surrounding areas, (ii) increase coverage for fixed internet and digital TV by connecting more homes to the network, and (iii) increase the network for Business-to-Business (B2B).

In terms of development impact and IIC’s Business Priority Areas, the Project is aligned for (a) social inclusion and inequality, productivity and innovation; (b) promotion of infrastructure for development; (iii) support innovation and technological development and (iv) enhance private provision of basic goods and services, income generating opportunities and social mobility for vulnerable populations.

In addition, the Project is in line with the Paraguayan government’s policy for Telecom implementation in the country, which is focused on accompanying the shift in telecom from voice to data, and on ensuring a universal and affordable availability of broadband. Furthermore, the investment proposal is aligned with the Global Connect Initiative of which the Paraguayan government is part of and whose main objective is to bring 1.5 billion persons to the online world by 2020 while at the same time reducing or closing the digital gap between those with Internet access and those without it.

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Environmental and social review

IDB Invest conducts an environmental and social due diligence (ESDD) commensurate with the nature, scale, and stage of the project, and with its level of environmental and social risks and impacts. The ESDD will confirm the project E&S categorization and assess the project with respect to the client requirements in IDB Invest Environmental and Social Sustainability Policy. The results of the ESDD, including any identified gaps are described in the Environmental and Social Review Summary (ESRS) provided below. Any gaps with respect to the IDB Invest Sustainability Policy at the time of the ESDD are addressed in the Environmental and Social Action Plan (ESAP) provided below.

ENVIRONMENTAL AND SOCIAL REVIEW

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Contact information

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EMAIL

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PHONE

+1(202)-566-4566

ADDRESS

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